Replacing Sticks with Carrots When It Comes to Tax Disclosures? New Proposals regarding Form 8275-R


 

The IRS has long used mandatory disclosures by taxpayers on Form 8886 (Reportable Transaction Disclosure Statement) to discourage participation in reportable transactions and carry out enforcement campaigns. The IRS has taken a different approach in the past, though, when it comes to taxpayers taking positions on returns that might be considered aggressive, novel and/or divergent from existing guidance. The IRS favored the carrot, offering penalty protection to taxpayers on the condition that they adequately revealed their positions. The recent Green Book shows that the current Presidential Administration is advocating all stick, and no carrot, when it comes to disclosures to the IRS. This article gives taxpayers and their advisors key information about this important, evolving issue.

 Read the full article here.

About Hale E. Sheppard
HALE E. SHEPPARD, Esq. (B.S., M.A., J.D., LL.M., LL.M.T.) is a Shareholder in the Tax Controversy Section of Chamberlain Hrdlicka and Chair of the International Tax Group.

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